Strategic thinking involves synthesizing information to determine a company's competitive advantage and future success. It requires taking an overview perspective while examining details to understand how elements fit together. Strategic thinking has both analytical "hard" sides involving tools and techniques, as well as "soft" sides involving vision, values, and culture. It is a skill that challenges even exceptional thinkers, as it does not follow a step-by-step process but requires insight and reflection.

1. Strategic thinking is a relatively new business
concept that takes its place amid more established and
studied activities of strategy formulation, strategic planning,
and strategic decision making. These activities can't be
successful without strategic thinking.
Strategic thinking is about synthesizing
information and ideas in order to determine a company's
competitive advantage and future success. It leads to
establishing objectives, planning courses of action, and
allocating resources in a constantly changing business
environment.
If you want to become a strategic thinker you
must be prepared to think with your heart as well as your
head. Even then, you can never be sure how the future will
turn out, but you will have the skills to help you make your
next strategic move.
This document will help you
• Appreciate the value of strategic
thinking in the workplace
• Recognize the attributes that
comprise strategic thinking
• Develop competencies to become a
strategic thinker
• Participate in strategic thinking
activities
• Incorporate strategic thinking into
your leadership role and activities

2. Strategic Thinking in Today's Business Environment
• Strategic thinking involves the collection, interpretation, generation, and evaluation of information
and ideas that shape an organization's sustainable competitive advantage and future success.
• The ability to think strategically creates a mind-set that makes sense of the complexities facing an
organization and enables strategic leaders to originate ideas that differentiate a company from its
competitors.
• There is a variety of approaches in the schools of strategic thought; however, they all have a
common objective – to find a pattern that separates success from failure.
• Strategic thinking is different from strategic planning. Strategic thinking attempts to establish what
the organization should look like while strategic planning focuses on how to get there.
• The strategic thinker takes an overview perspective, while looking at details and asking how things
fit together to make patterns and connections.
• There is a "soft side" as well as a "hard side" to strategic thinking. The hard side of strategic thinking
involves the kind of rigorous analytical tools and techniques taught in business schools. But
strategic thinking has a softer side that is also a vital part of understanding and developing strategy,
vision and values, culture and climate.
What is Strategic Thinking ???
Strategic thinking is not a step-by-step process. It requires a degree of insight and reflection that is
not always a natural part of business operations. It can be challenging, even for exceptional thinkers.

3. Every business needs a strategy. The essence of strategy is both structured and flexible,
requiring leaders to balance their thinking between operational (analytical, practical) and
imaginative (visionary, innovative) thinking. These two types of thinking are sometimes
called quantitative (measurable) and qualitative (immeasurable). A quantitative approach
is practical, specific, and implementable. In contrast, a qualitative approach is visionary,
conceptual, and flexible.
It's useful to differentiate between operational and imaginative thinking:
• Operational thinking is linear; imaginative thinking is nonlinear
• Operational thinking involves the head; imaginative thinking involves the heart
• Operational thinking is verbal; imaginative thinking is visual
• Operational thinking involves analysis; imaginative thinking involves synthesis
• Operational thinking is explicit; imaginative thinking is implicit
These two types of thinking are distinct but related. The analytical and practical
techniques of operational thinking form a base for the innovation and vision of
imaginative thinking. This imaginative thinking about the potential future, grounded in
the operational thinking about the current reality, is what creates strategic thinking.
This balance is what makes strategy such a powerful concept.

4. Strategic thinking is laden with contrasting but
complementary attributes. Perhaps this is why it is often
difficult to define strategic thinking. It is also why it has so
much potential and power in business, accommodating the
complexities of the modern business world.

5.  Strategic thinking is different from strategic planning. Strategic thinking
attempts to establish what the organization should look like while strategic
planning focuses on how to get there.
 The strategic thinker takes an overview perspective, while looking at details and
asking how things fit together to make patterns and connections.
 There is a "soft side" as well as a "hard side" to strategic thinking. The hard side
of strategic thinking involves the kind of rigorous analytical tools and techniques
taught in business schools. But strategic thinking has a softer side that is also a
vital part of understanding and developing strategy, vision and values, culture
and climate.
Strategic thinking is not a step-by-step process. It requires a degree of insight and
reflection that is not always a natural part of business operations. It can be
challenging, even for exceptional thinkers.

6. Strategic thinking involves attributes from both operational and imaginative
thinking:
Strategic thinking is linear as well as nonlinear. Linear thinking involves creating
sequential relationships between things. It is logically patterned and deals with
rules, analysis, and cause-effect predictability. Nonlinear thinking is about
interconnectedness and involves intuitive assessments, creativity, innovation, and a
holistic view of the organization. Linear thinking is important for organizational
purposes. Nonlinear thinking involves imagining how events might affect a goal,
then devising effective responses.
Strategic thinking engages the heart as well as the head. The head governs intellect
and involves reasoning from evidence. The heart governs emotion and is important
for inspiration and motivation. Emotions and feelings are imperative in the process
of strategic thinking.
Strategic thinking is visual as well as verbal. Strategic thinking involves making the
transition from verbal thinking back to visual thinking. Strategic leaders have the
capacity to influence and organize meaning for the organization by creating shared
imagery. Verbalization is important for imparting procedural knowledge.
Visualization enables leaders to use concrete means to understand and explain
abstract concepts using images, metaphors, and models.

7. Strategic thinking is implicit as well as explicit. Strategic thinking involves two types
of knowledge – practical, or explicit, and conceptual, or implicit. Explicit knowledge is
fact related. It is formal, systematic, and gained from interpretation of data. It can be
learned as distinct steps, as in a formula or checklist. Implicit knowledge is intuitive
and interpretive. It is inferred from observable behavior or performance, and grows
from expertise and experience. Without an explicit knowledge base, strategy will lose
any sense of organizational consciousness. Implicit knowledge is necessary for
flexibility and innovation.
Strategic thinking requires synthesis as well as analysis. Analysis involves
deconstruction – breaking down something into its constituent elements. Synthesis
involves creation – reconstituting a whole from its parts, seeing the design, and
understanding how the pieces fit together. By its nature, analysis is applied in the
present. Only synthesis can identify possibilities for the future. Therefore, synthesis
and analysis are needed to plot a course from the present to the desired future.

8. Strategic thinking helps organizations realize a number of benefits:
Discover opportunities for future success. The pursuit of business opportunities
requires creativity.
Seek growth markets. Strategic thinking helps companies to identify where they are
now, where they want to go, and how they are going to get there.
Make swift decisions. Strategic thinking helps an organization discover a clear path for
success.
Foster innovation. Strategic thinking requires creative managers who can deal with
practical details as they implement a vision for the future.
Empower employees. Strategic thinking brings people together to face business
challenges in an unpredictable world.
Offset risks. Strategic thinking helps establish formal systems of discovering
opportunities and planning for the unexpected in an environment that is continually
changing.
Without strategic thinking, businesses may be able to navigate today's challenges, but
are unlikely to grasp opportunities for growth.

9. Strategic Thinking Competencies :
In business, a competency is the ability to apply and use a combination of skills,
knowledge, and attitudes to achieve an objective.
There are five strategic thinking competencies that are integral to strategic leadership:
scanning, visioning, reframing, making common sense, and systems thinking.
Scanning involves assessing an organization's strategic situation using both "hard" and
"soft" methods. Scanning includes an examination of the strengths and weaknesses in the
organization, as well as the opportunities and threats in the industry. Strengths and
weaknesses are internal factors that are usually within the control of the organization.
Opportunities and threats involve external political, economic, social, and technological
factors that are generally outside the control of the organization. This type of scanning is
often accomplished with an assessment known as a SWOT analysis.
Being competent at scanning also means you are always observing or on the lookout for
any information or insight that will inform your understanding of your company's strategic
situation.
Becoming a Strategic Thinker

10. Visioning is the skill of crafting a vision for an organization and conceiving the means to achieve that end.
A visionary leader understands the concept of connectedness – how the paths from the present, or real,
lead to the future, or soon-to-become real. The ability of a leader to envision and describe an
organization's desired future is at the heart of the ability to create it.
Reframing is the ability to adjust and change the frame of reference through which you view challenges,
opportunities, and vision. It is the skill of bringing persons, groups, departments, and organizations into a
common frame of reference by developing a spectrum of understanding. Put simply, reframing is altering
the value or perception of something by altering its context.
Strategic decision-makers work in dynamic environments where "change dilemmas" are a fact of life.
Unless they have the ability to reframe their own viewpoint and understand that of others, they can lose
sight of the organization's vision.
Making common sense of complexity is the skill of achieving a coherent strategy that makes the
organization's vision practical and understandable to others. Strategy is more than just giving directions; it
is developing a shared understanding of the direction of the organization. Understanding allows
stakeholders to rely on implicit knowledge to interpret policies, implement processes, and set priorities.
Systems thinking focuses on how things interact with other things within integrated systems. Instead of
looking at strategy as a whole, and then breaking it down into smaller and smaller components, systems
thinking looks at those small components and then expands the view to see how each of those
components relates to the strategy as a whole. It constructs, rather than deconstructs. Systems thinking
helps organizations look for and discover patterns and relationships.

11. There are phases of strategic thought, and while they are not exactly linear, they do help to move the
process along toward strategic action:
 Gathering information
 Formulating ideas
 Planning for action
Gathering Information :
So what kind of information is important to gather? It can range from highly structured and quantitative data
from reports and publications, to more qualitative data gathered through talking with other people.
To gather a sufficient mix of information, it is important to "get out in the world" and validate what you are
collecting. This means talking, listening, and getting a feel for what your employees, customers, and non-
customers are thinking and doing. When gathering information, you look for patterns and try to make some
initial "sense" out of what you are absorbing.

12. Review current and past market status. This promotes learning from
the present and the past, and thinking about and reflecting on successes
and failures.
Take stock of your resources and capabilities. Focus on the
organization's core competencies and unique resources.
Explore the competitive environment. Gauge what your organization is
up against. This requires reviewing the strengths, weaknesses
There are a number of actions to take during the gathering
information phase:

13. As you formulate ideas, you think about the information you gathered but keep the door open for new
information all the time. Visualization is important at this stage in order to consider what cannot yet be
seen.
When formulating ideas, you take possible opportunities to the next level, attempting to predict and
forecast the future. This is also the time to question and challenge assumptions.
There are a number of actions to take during the formulating phase:
Assess risks, threats, and vulnerabilities. Consider potential threats, including financial vulnerability,
natural disasters, changing customer preferences, and supply shortages.
Explore critical success factors. This involves looking at the big picture and the forces that drive
success in the industry. These can include cost, innovation, ease of application, rapid time-to-market,
reliability, and brand recognition.
Check assumptions. Talk with others and ask them to challenge your assumptions. Find "devil's
advocates," or use conventional methods such as benchmarking or market studies.
Formulating Ideas

14. Planning for Action
When thinking strategically about taking action, you evaluate, prioritize, and consider
options and implications.
Some actions in the planning for action phase include crafting a mission statement,
prioritizing resources and activities, and drafting the strategy:
A mission statement is a broad statement of strategic intent. It states what the
organization plans to do, outlines who it is trying to reach, and suggests what type of
plans will be carried out. It includes understandable and achievable targets.
Prioritizing resources and activities is the process of choosing to devote resources to the
strengths that bring the greatest value to the organization. Setting strategic priorities
involves identifying strategic drivers that determine success, demonstrating a
commitment to the priorities through your actions, and ensuring that priorities are
communicated throughout the organization.
Drafting the strategy involves connecting the means and the mission. It involves working
from the priorities and selecting the most appropriate tools and methods to achieve the
objectives of the mission. In essence, it sets the roadmap between where the
organization is and where it wants to be.

15. Leader as Strategic Thinker
Strategic Leadership
The transformation of strategic thinking into a tangible outcome is the most important
responsibility of a strategic leader. No business can survive without the practical planning
and control of tasks and processes, and the specific distribution of resources. But in a
world where a competitor's innovative concepts and products can render a company
obsolete before it even recognizes the threat, strategic skills are equally important for
survival. Successful leaders pursue their vision with as much zeal as they pursue
operational efficiency.
Create Conditions for Strategic Thinking
Leaders and managers must demonstrate and encourage strategic thinking. This requires
creating a work environment that enables others to make decisions that work toward a
common vision.

16. Make strategy a learning process. In essence, strategy is a theory about how an organization
can achieve success. That strategy is generated by strategic thinking, but is also informed by
knowledge and learning from work experience. To elicit this knowledge, use opportunities to test
theories, conduct experiments, and hold debriefing sessions.
Empower others to participate. Employees differ in the type of work they do, and in their
authority, experience, and sophistication, but all of them need to be empowered to think
strategically.
Reward appropriate risk taking. Employees need to know that the organization trusts them to
act independently to make strategic decisions. When a strategic idea or action fails to succeed as
planned, avoid punishment and treat people fairly.
Act decisively in the face of uncertainty. In implementing strategy, ambiguity is one of the
greatest threats. To maintain strategic momentum, a leader must make decisions quickly,
communicate them clearly, and act decisively.
Act with the short term and long term in mind. Strategic leadership is a balancing act of
maintaining present effectiveness, while maximizing the potential for future achievement.
Here are some ways you can support strategic thinking in your work
environment:

17. Summary
No business can grow and succeed without a strategy. It is not enough to simply
tackle problems and react to day-to-day demands; you also need to plan
programs, align resources, and overcome competitive threats in the short- and
long-term. Strategic thinking requires scanning the environment and
understanding what is changing in relation to what you know about your
company. It requires envisioning what could be possible and how those
possibilities interrelate in a system. When you are thinking strategically, you are
also involving others, building on ideas, reframing perceptions, and making
sense of complexity in the face of change. Strategic thought is not only creative
and adaptive but also incorporates logic and practical knowledge to create a
balanced approach.